Cashews: Cambodia wants its share of the cake

August 21, 2023 at 10:50 AM , Der AUDITOR
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NEW DELHI/PHNOM PENH. Cambodia has ambitious plans of transforming its cashew industry into a leading processor and exporter. Waters are, however, rough and current targets may be too ambitious.

Ambitious targets in Cambodia

In terms of exports Cambodia largely depends on Vietnam. The leading producer, in fact, exports as much as 95% of its raw cashew nuts to Vietnam as the Cashew Nut Association of Cambodia (CAC) states. Japan and China are also important export destinations. At present, traders ship more than 90% of the country’s production to neighbouring countries, where the nuts are processed, and the industry is calling for drastic changes to remedy this unsatisfactory situation.

A call, which the government is actively embracing. In June 2023, the Cambodian Ministry of Commerce issued the National Policy on Cashews for 2022-2027 with the main objective of transforming the country into a leading processor and exporter, while securing continuous high-quality output. The objective is highly ambitious as Cambodia currently only has around thirty small-scale and three medium-sized processing plants. CAC reckons that at least fifty new medium-sized facilities will need to be built to meet the 2027 target.

Waters are also rough for production. Adverse weather conditions caused production to dip in 2022 and exports to decline to 670,000 mt. They, by contrast, peaked at 1.1 million mt in 2021. Cambodia also shipped 950,000 mt of raw cashew nuts overseas in 2020 and 600,000 mt in 2019. Although the quality of this year’s production is much better than last year, downside is that unattractive prices prompted many farmers to switch to other products. CAC estimates that the area under cultivation has dropped by around 100,000 ha and only covers about 700,000 ha this year.

Prices have, in addition, turned in opposite directions. While raw cashew nut prices have, fortunately, risen again this year, the market prices for processed nuts are witnessing a decline as local media report. Improved quality has driven up the prices for raw cashew nuts from USD 1,200/mt last year to USD 1,500-1,700/mt this year. Average prices for processed nuts have, however, declined to USD 6.50/kg, which undercuts cost prices. Processors would require a price of USD 8.00/kg to cover production expenses.

Trouble in India

Vietnam has had a horrible time trying to sell cashew kernels this year with the Vietnam Cashew Association reporting a USD 1 billion trade deficit. This has also impacted India as The Times of India reports that traders in Andhra Pradesh are very much worried about illegal imports from Vietnam, that have flooded the domestic market in recent months. Trouble is not only that these volumes undercut prices but also that they are of low quality, which has implications for India’s exports. While prices rose at the start of August, they have remained firm in recent weeks. W240 cashew nuts are trading at USD 8,430/mt FOB India.

Cashews, India













FOB India


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